Voluntary Information Disclosure and Corporate Governance: The Empirical Evidence on Earnings Forecasts

Naohito Abe () and Yessica C.Y. Chung

Hi-Stat Discussion Paper Series from Institute of Economic Research, Hitotsubashi University

Abstract: This study investigates the determinants of companies' voluntary information disclosure. Employing a large and unique dataset on the companies' own earnings forecasts and their frequencies, we conducted an empirical analysis of the effects of a firm's ownership, board, and capital structures on information disclosure. Our finding is consistent with the hypothesis that the custom of cross-holding among companies strengthens entrenchment by managers. We also find that bank directors force managers to disclose information more frequently. In addition, our results show the borrowing ratio is positively associated with information frequency, suggesting that the manager is likely to reveal more when his or her firm borrows money from financial institutions. However, additional borrowings beyond the minimum level of effective borrowings decrease the management's disclosing incentive.

Keywords: Voluntary information Disclosure; Corporate Governance; management earnings forecast (search for similar items in EconPapers)
JEL-codes: G10 G14 G18 (search for similar items in EconPapers)
Date: 2007-01
New Economics Papers: this item is included in nep-cfn and nep-for
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Related works:
Journal Article: Voluntary Information Disclosure and Corporate Governance: The Empirical Evidence on Earnings Forecasts (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:hst:hstdps:d06-203

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